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Saturday, July 1, 2017

The correct answer is nothing. You do nothing with Form 5498-SA. Form 5498-SA is a statement of contributions. The amount shown on 5498-SA should have already been on your W2 so there's no need to enter it on your Federal tax return. Form 5498-SA is for informational information only. The Form is confusing because it looks just like a 1099-MISC. But not to worry. No need to enter onto the tax return.

Friday, April 28, 2017

Before you read "exactly" what the IRS tells you about the OIC or Offer in Compromise program, understand a few things the IRS doesn't say.

If you read and follow the instructions you can prepare and file a successful OIC. This doesn't mean that the IRS won't reject your first or even second submission. Just follow the instructions and stay committed.

When completing your expenses and income form (Form 656, Form 656-A, Form 656-B) ALWAYS remember that private school and your cable bill are NOT qualified expenses. This also applies to additional luxury items that you may be financially responsible for.

If you have the finances, it's best to consult with an Enrolled Agent to help you file your OIC, especially if you have assets that you'd like to protect.

Know that the IRS is governed by a book called "The Tax Codes." In most cases, their response to you is not personal, but legal. Yes, an IRS agent can make decisions which can make your life easier, and that is why you always want, to be honest, and professional when speaking with an IRS agent. It is a felony to lie to a federal agent.

Now let's read what the IRS has to say on the matter:

Taxpayers who have a tax debt they cannot pay may have heard that they can settle their tax debt for less than the full amount owed. It’s called an Offer in Compromise.

Before applying for an Offer in Compromise, here are some things to know:

In general, the IRS cannot accept a settlement offer if the taxpayer can afford to pay what they owe. Taxpayers should first explore other payment options. A payment plan is one possibility. Visit IRS.gov for information on Payment Plans – Installment Agreements.

A taxpayer must file all required tax returns first before the IRS can consider a settlement offer. When applying for a settlement offer, taxpayers may need to make an initial payment. The IRS will apply submitted payments to reduce taxes owed.

The IRS has an Offer in Compromise Pre-Qualifier tool on IRS.gov. Taxpayers can find out if they meet the basic qualifying requirements. The tool also provides an estimate of an acceptable offer amount. The IRS makes a final decision on whether to accept the offer based on the submitted application.

Taxpayers wishing to file for an Offer in Compromise should visit IRS website’s Offer in Compromise page for more information. There taxpayers can find step-by-step instructions as well as the required forms. Taxpayers can download forms anytime at www.irs.gov/forms or call 800-TAX-FORM (800-829-3676) and ask for Form 656-B, Offer in Compromise booklet.

Friday, April 7, 2017

WASHINGTON — With the tax deadline fast approaching, the Internal Revenue Service today reminded taxpayers that they can use IRS.gov to find fast answers to tax questions, use free online tools and find key tax forms and publications. With millions of people just now seeking help to complete their taxes, the IRS expects high call volumes between now and the April 18 tax filing deadline. This makes IRS.gov even more invaluable to taxpayers seeking quick answers. Answers to the most common questions taxpayers have this time of year are on IRS.gov.A

Wednesday, April 5, 2017

Special Note: Businesess who have already filed may still use this option for the 2016 tax season.

WASHINGTON –The Internal Revenue Service today issued interim guidance explaining how eligible small businesses can take advantage of a new option enabling them to apply part or all of their research credit against their payroll tax liability, instead of their income tax liability. Before 2016, taxpayers could only take the research credit against their income tax liability.

Notice 2017-23, posted today on IRS.gov, provides guidance on a new provision included in the Protecting Americans From Tax Hikes (PATH) Act enacted in December 2015. This new option will be available for the first time to any eligible small business filing its 2016 federal income tax return this tax season. Those who already filed still have time to choose this option.

The option to elect the new payroll tax credit may especially benefit any eligible startup that has little or no income tax liability. To qualify for the new option for the current tax-year, a business must have gross receipts of less than $5 million and could not have had gross receipts prior to 2012.

An eligible small business with qualifying research expenses can choose to apply up to $250,000 of its research credit against its payroll tax liability. An eligible small business chooses this option by filling out Form 6765, Credit for Increasing Research Activities, and attaching it to a timely-filed business income tax return. But under a special rule for tax-year 2016, a small business that failed to choose this option and still wishes to do so, can still make the election by filing an amended return by Dec. 31, 2017. See the notice for further details.

After choosing this option, a small business claims the payroll tax credit by filling out Form 8974, Qualified Small Business Payroll Tax Credit for Increasing Research Activities. This form must be attached to its payroll tax return, for example Form 941, Employer’s Quarterly Federal Tax Return. Further details on how and when to claim the credit are in the notice.

The notice provides interim guidance on controlled groups, the definition of gross receipts, and other issues. The notice also requests public comment on various payroll tax credit issues to be addressed in future guidance. See the notice for details on how and when to submit comments. For more information on the research credit itself, see the instructions to Form 6765.

Monday, January 23, 2017

Taxpayers who still file paper returns may find now is the best time to switch to e-file. Last year over 85 percent of taxpayers filed their taxes electronically. E-file is the fastest and safest way to file.

Here are the top seven reasons a taxpayer should file electronically in 2017:

Accurate and Easy.IRS e-file is the best way to file an accurate tax return. The tax software helps taxpayers avoid mistakes by doing the math for them. It guides users through each section of a tax return. E-file is easier than doing taxes by hand and mailing paper tax forms.

Safe and Secure. IRS e-file meets strict security guidelines. It uses modern encryption technology to protect tax returns. The IRS continues to work with states and tax industry leaders to protect tax returns from refund fraud. This new effort has put more safeguards in place to make tax filing safer than ever before. The IRS has processed more than one billion e-filed returns safely and securely.

Convenient and Often Free. Taxpayers can e-file for free through IRS Free File. Free File is only available on IRS.gov. Taxpayers may qualify to have their taxes e-filed for free through IRS volunteer programs. Volunteer Income Tax Assistance offers free tax preparation for those earning $54,000 or less. Tax Counseling for the Elderly generally helps people who are age 60 or older. Taxpayers can buy commercial tax software or ask their tax preparer to e-file their tax return. Most paid preparers have to file their clients’ returns electronically.

Faster Refunds. In most cases, e-file prevents mistakes and helps people get their refund faster. The quickest way to get a refund is to combine e-file with direct deposit into a bank account. The IRS issues more than nine out of 10 refunds in less than 21 days – however, some returns need further review and take longer.

Prior-Year Tax Return. Taxpayers should keep a copy of their tax return. Beginning in 2017, taxpayers using a software product for the first time may need their Adjusted Gross Income (AGI) amount from their prior-year tax return to verify their identity. Taxpayers can learn more about how to verify their identity and electronically sign tax returns at Validating Your Electronically Filed Tax Return.

Health Care Coverage Reporting. IRS e-file can help with tax provisions of the health care law. The software will walk users through each line on the tax form that relate to the Affordable Care Act.

Payment Options. If taxpayers owe taxes, they can e-file early and set up an automatic payment on any day until the April 18 deadline. They can pay electronically from their bank account with IRS Direct Pay. Other payment options include electronic funds withdrawal and payment by debit or credit card. Visit IRS.gov/payments for details.

Thursday, November 3, 2016

This is when the IRS sends you written (legal notice) to your employer and or your bank saying that you owe the IRS and that the employer and or the bank is under legal obligation to forward YOUR money to the IRS to satisfy your tax debt.

The good news is the IRS will send you a series of tax notices before this happens..

The bad news is; When and if you don't respond to their mail, the IRS will levy your bank account and attach your wages, legally, without having to go to court.

If you are receiving notices because of unfilled taxes, the way to avoid a tax levy is to:

First, file your OWN tax return. Do not rely on the IRS's Substitute Return (a return the IRS prepared for you)

More than likely you'll owe less money. However the penalties and interest can increase the amount back up. In fact we've had clients who ended up getting a refund.

At this point you don't need an attorney. It's just a matter of filing your unfilled tax returns, unless there are additional skeletons in your tax closet.

We can offer you professional, affordable and expert help, but you'll need to provide me with your tax information. Visit this page and scroll to the bottom for easy instructions on how to get your tax information.

It is best to get your tax information directly from the IRS, that way your unfilled return will correspond with what the IRS has on file and your chances of being audited will decrease. Anytime the IRS contacts you concerning unfilled tax returns, you become a person of interest. The best way to get them off your back is to file a return which includes the same figures the IRS has in your tax file/records. Yes, your bank and your employers has already sent information to the IRS - This is how they know you should have filed and didn't.

The IRS won't go away. They don't know how. They will get your attention one way or another. Visit me on the eBay platform, which is safe and easy, and get the IRS off your back. .

We depend on the safety and security of a "fax" You fax your info to our secure fax line, which we have the password and security information to access.We send your pdf tax return black under a fake "subject" You print out your return, delete the email and act like nothing happened.We delete our attachment files once you receive your tax return. .Easy. Fax info to secure lineReceive taxes in PDF formatPrint Out. Sign, Date and Mail or take to the IRS.We delete the attachment.

Okay,
how do I get my tax information to fax to you? I lost my W2s and all
tax information for the year(s) the IRS is bugging me about.Easy. We explain in detail how to get yourtax information from the IRS

If you'd rather NOT talk to the IRS, we all explain a way to get your informationwithout speakingto the IRS.

The IRS prepared a "Substitute Tax Return" for me, now they say I owe them money. Should I just pay them? What about a payment plan?

NO. Before you make payments, you should file your OWN
tax return, which we can do for you. We will still need your tax
information and once you receive this information from the IRS we can
have your return ready within 48 hours.

The IRS is not
aware of your legal tax deductions or write-offs. When we prepare a
"real" return, more than likely you'll less, maybe even a lot less.

YES.
We can help you with an Installment Agreement. We complete the
Installment Agreement Request Form and usually the IRS will grant the
Installment Agreement if you don't already have a payment plan in place
and sometimes, even if you do.

Go here follow the instructions at the bottom of the page. We use eBay. As you know eBay will ensure you receive the services you pay for. We
have an excellent rating. You will receive information where to fax
your information after you've completed the transaction on eBay

Who the hell are you, and why should I trust you?

I am the lead tax accountant. Retired part-time. Registered with the IRS every year since 1999. Basic tax instructor in the San Francisco Bay Area. Since retirement, I travel often, write children's books and books on how to save on taxes. By law I must and will provide to you, my ID# from the Department of Treasury.

Tax Loopholes do exist for the middle income taxpayer. Everything from deducting a percentage of the cost of your cell phone bill when your mobile phone is used for business and your employer does NOT reimburse you to deducting the cost of security provided by security dogs who remain on your business property overnight.

Wednesday, April 9, 2014

The Senate Finance Committee held a hearing
Tuesday on the subject of incompetent and unethical tax preparers and
heard testimony on how the Internal Revenue Service should deal with
them.

The committee heard testimony from IRS
commissioner John Koskinen, National Taxpayer Advocate Nina Olson, an
official with the Government Accountability Office, tax preparers and
advocates from across the country, as well as the attorney who
represented the tax preparers whose lawsuit ended the IRS’s tax preparer
regulatory program.

“Taxpayers today face a double burden:
crooked or incompetent tax preparers, along with an overgrown and
complicated tax code. We should put an end to both,” said Senate Finance
Committee chairman Ron Wyden, D-Ore. “I’m proud to say my state gets
this issue right. While Oregon and a few other states are already
leading in this area, we need to restore federal standards to protect
all American taxpayers.”

Wyden
said that unlike many other industries, paid tax preparers don’t have
to meet any standards for competence in order to prepare someone else’s
return.

“In some egregious cases, preparers calculate a taxpayer’s
refund in person and skip the line that shows who did the work,” said
Wyden. “Then after the taxpayer leaves, the preparer falsifies the math
to boost the refund, files the return and pockets the difference. And
worst of all, unless the taxpayer can prove what happened, they’re on
the hook for the money when the IRS finds out.”

At the hearing,
the GAO released the results of a new investigation involving undercover
site visits in which 17 of 19 randomly selected, paid tax preparers
failed to complete a tax return accurately, either due to significant
mistakes or willful negligence. The new GAO investigation reported
findings similar to those of a 2006 GAO investigation that identified
preparer mistakes in 19 of 19 uncover visits.

Tax refund errors in
the site visits varied from giving the taxpayer $52 less to $3,718 more
than the correct refund amount. Only two out of 19 preparers calculated
the correct refund amount. The full report can be found here.

GAO
director of tax issues James R. McTigue Jr., told the Senate committee
that tax returns prepared by a paid preparer showed a higher estimated
error rate of 60 percent, compared to an error rate of 50 percent for
tax returns that were self-prepared by the taxpayer.

Voluntary Certification

IRS
commissioner John Koskinen told the senators that the tax preparer
community is a key ally in the agency’s efforts to fulfill its dual
mission of providing taxpayer service and ensuring tax compliance. “We
view our relationship with tax professionals as a partnership, one that
has enabled a system that interacts with hundreds of millions of
taxpayers to nimbly adjust to new tax laws, speed the average time for
refunds, and encourage the voluntary compliance of taxpayers,” he said.
“Return preparers are a vital link between the IRS and taxpayers,
especially given that the vast majority of people seek help in doing
their taxes.”

Koskinen noted that each year, paid preparers are
called upon by taxpayers to complete about 80 million returns, or about
56 percent of the total individual income tax returns filed, while
another 34 percent of taxpayers use tax preparation software, for a
total of 90 percent who seek some form of assistance.

“Competent
preparers make our job easier by helping their clients properly report
their taxes and pay what they owe,” said Koskinen. “Given the crucial
role that return preparers play in our tax system, the IRS believes it
is critical to ensure a basic competency level for tax return preparers
and to focus our enforcement efforts on identifying and stopping
unscrupulous preparers.”

Last year, he noted, the U.S. District
Court for the District of Columbia issued an injunction last year in the
case of Loving v. IRS that prevented the IRS from enforcing the
regulatory requirements it had tried to impose for competency testing
and continuing education, and the decision was upheld by a federal
appeals court this year. “The IRS is continuing to assess the scope and
impact of the court’s decision while consideration is given to options
for appeal,” he added.

Koskinen noted that the Obama
administration’s fiscal 2015 budget includes a proposal to explicitly
authorize the IRS to regulate all paid tax preparers. He asked Congress
to provide that authorization and said the IRS might offer a voluntary
form of certification to tax preparers in the meantime.

“Following
the court decision, the IRS remains concerned about protecting
taxpayers and ensuring they receive quality assistance in preparing
their tax returns,” said Koskinen. “While we urge Congress to quickly
enact the proposal described in the President’s Budget, we are taking a
close look at the possibility of an interim step involving a program of
voluntary continuing education.

The idea of a voluntary program is under
consideration because we believe it is important to maintain the
momentum for regulation and oversight of unregulated preparers that has
built up over the last five years, and to lessen the risks to taxpayers
resulting from the lack of federal education requirements. Before moving
forward on this idea, however, we will solicit feedback from a wide
range of external stakeholders as to whether such an interim step would
be useful and appropriate.”

Taxpayer Advocate

National
Taxpayer Advocate Nina Olson reiterated her support for requiring
competency exams for tax preparers, pointing out that she had been an
unenrolled tax preparer at one time. “Shortly after I graduated from
college in the mid-1970s, I hung out a shingle and held myself out as a
return preparer,” she said. “I had been a Fine Arts major, so to say the
least, I was not a tax expert. But in that period, tax software was not
yet widely available, so an individual wanting to prepare tax returns
had to learn the basics. I took this endeavor seriously, and ultimately,
I believe I did a good job for my clients. Even then, however,
taxpayers would have been better served if return preparers were
required to demonstrate basic competency in tax return preparation.”

However,
Olson noted that tax prep software makes it easy for anyone to claim
they are tax preparers. “With the advent of tax preparation software and
the Q&A format, a person can hold himself out as a return preparer
with almost no knowledge or skill by simply sitting with a taxpayer and
working through the software’s prompts,” she said. “As many undercover
‘shopping visits’ to return preparers have found, preparing returns with
software and little knowledge typically does not produce accurate
results.”

She pointed out that unscrupulous tax preparers are able
to take advantage of clients and charge high fees for services such as
pay-stub loans and refund anticipation checks, which have largely
replaced refund anticipation loans in recent years.

“In tax year
2012, 56 percent of 142 million individual taxpayers paid preparers to
complete their returns for them,” said Olson. “Very simply, the absence
of minimum competency standards for return preparers leaves these
taxpayers vulnerable to inadvertent errors that could cause them to
overpay their tax or to underpay their tax and face IRS collection
action. It also leaves some taxpayers open to unscrupulous preparers,
many of whom would be weeded out if the return preparation industry were
professionalized. At present, we require volunteers who help prepare
returns for elderly, disabled, and low-income taxpayers through the VITA
and TCE programs to pass a competency test. Yet we ask nothing of
hundreds of thousands of persons who make their living off tax
preparation. That makes little sense to me.”

H&R Block
president and CEO William Cobb told the senators about his company’s
support for tax preparer regulation. “H&R Block employs more than
70,000 highly trained tax professionals across the country and 80,000
professionals worldwide,” he said. “A typical client is served by an
H&R Block tax professional with more than a decade of experience and
hundreds of hours of training. Our tax professionals progress through a
14-level certification program, culminating in master tax adviser
status. To be re-hired, H&R tax professionals must complete at least
15 hours of continuing education annually. H&R Block’s tax
professionals are trained on systems, policies and procedures that
require an additional 35 hours of education annually.”

State Licensing

Wyden
touted Oregon’s tax preparer licensing standards and pointed out that a
2008 study by the GAO found that tax returns from Oregon were 72
percent more likely to be accurate than returns from the rest of the
country.

Wednesday, February 12, 2014

The D.C. Circuit Court of Appeals ruled Tuesday that the IRS had no
legal authority to impose a nationwide licensing scheme on tax return
preparers that would have required testing and continuing education as
Registered Tax Return Preparers. continue below:

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The decision affirms
a January 2013 ruling by U.S. District Court Judge James E. Boasberg,
which struck down the IRS’s new regulations as unlawful (see Court Rules IRS Doesn’t Have the Authority to Regulate Tax Preparers). In the case, known as Loving v. IRS,
both courts rejected the IRS’s claim that tax-preparer licensure was
authorized by an obscure 1884 statute governing the representatives of
Civil War soldiers seeking compensation for dead horses.

“This is a
major victory for tax preparers—and taxpayers—nationwide,” said Dan
Alban of the Institute for Justice, the lead attorney for the three
independent tax preparers who filed the suit. “The court found that
Congress never gave the IRS the power to license tax preparers, and the
IRS cannot give itself that authority.”

The
appeals court held, “If we were to accept the IRS’s interpretation of
[the statute], the IRS would be empowered for the first time to regulate
hundreds of thousands of individuals in the multi-billion dollar
tax-preparation industry. Yet nothing in the statute’s text or the
legislative record contemplates that vast expansion of the IRS’s
authority.”

More than 350,000 tax-return preparers would have been
subject to the regulations. The attorneys for the preparers argued that
the regulations would have put tens of thousands of mom-and-pop
preparers out of business and increased the cost of tax-return
preparation for millions of taxpayers.

“My customers—not the
IRS—should be the ones who get to choose who prepares their taxes,” said
Sabina Loving, an independent tax preparer from Chicago and the lead
plaintiff in the case. “I have a right to earn an honest living without
getting permission from the IRS.”

The court ruled that “[t]he IRS
may not unilaterally expand its authority through such an expansive,
atextual,

“We think
it’s a major victory for both independent tax preparers and taxpayers,”
Institute for Justice senior attorney Scott Bullock said in an
interview. “The three-judge panel unanimously affirmed all the
fundamental points of the District Court’s opinion and held that the IRS
does not have the authority to regulate tax preparers under the statute
and under the legislative history of the law. The IRS simply cannot
assume that authority to license tax preparers. They need to go to
Congress to get that authority. That's what the D.C. Circuit held. They
gave six separate reasons for affirming the District Court opinion and
just really affirmed it across the board.”

Bullock hopes the IRS
decides not to pursue further appeals in the case. “It has now been
rejected by four judges, both the District Court and by three D.C.
Circuit judges,” he said. "They do have the right to petition the entire
D.C. Circuit. I believe they have 45 days to do so. The federal
government has a little bit longer than most folks. Then the court will
decide that relatively quickly. Then, after that, the next step for them
would be to go before the Supreme Court and they would have 90 days. If
they decide not to petition the entire D.C. Circuit, it would be 90
days from today. If they do decide to petition the entire D.C. Circuit
and they reject that, it would be 90 days from whenever that order
rejecting the en banc petition came though.”
When Judge
Boasberg clarified his original decision last year, he ruled that the
IRS can continue to require tax preparers to register for Preparer Tax
Identification Numbers, or PTINs, and the latest ruling should not
affect that. However, it should also bring some relief to tax
professionals.

“It was a big relief to many of the independent tax
preparers when the decision was first handed down,” said Bullock.
“Hopefully this will end the matter once and for all and they would not
be subjected these new licensing requirements, but it’s up to the IRS if
they decide to continue to appeal.”

The IRS was noncommittal on
whether it plans future appeals. “The IRS is currently reviewing the
decision,” the IRS said in a statement. “The IRS continues to believe
that it’s critical for taxpayers to be able to rely on quality work from
tax preparers.”

Bullock believes the IRS should provide refunds
to tax preparers who paid to take the tests and continuing education
courses before the RTRP regime was invalidated by the courts.

“I
believe they would probably be required to do that, and they [the tax
preparers] would have the right if they so choose not to be subjected to
these licensing requirements.”

“Administrative agency overreach
threatens the economic liberty rights of entrepreneurs,” said Institute
president and general counsel William Mellor in a statement. “This
precedent ensures that agencies must follow the law and cannot exceed
the power given to them by Congress.” As the Court noted,
“‘fox-in-the-henhouse syndrome is to be avoided . . . by taking
seriously, and applying rigorously, in all cases, statutory limits on
agencies’ authority.’”

IRS Commissioner John Koskinen has
indicated he would be open to offering the certification on a voluntary
basis to tax preparers if the IRS loses the appeal. “If you can’t
require it, offer it, and if you complete the information, you get a
certificate that says, ‘I have completed the IRS preparer course.’ I
think that could be over time very valuable to preparers, and consumers
could ask preparers, ‘Have you gone through the IRS training?’” said
Koskinen during a press conference last month after he was sworn in as
commissioner (see IRS’s New Commissioner Favors Voluntary Tax Preparer Certification).
“Whatever happens with the court case, we ought to be able to move
forward on that and provide taxpayers with as much assurance as we can
that the preparers they are dealing with have met some kind of minimum
standards.”

Bullock indicated the Institute for Justice would have
no problem with a voluntary certification scheme. “We made that very
clear in our statements because they [the IRS] had asked the D.C.
Circuit to stay the ruling, and they had stated they had no power to
even do this on a voluntary basis,” said Bullock. “And we had said,
‘That’s not true. You can offer this, but you can’t require licensure.
But if you want to do this on a voluntary basis, you’re free to do so.’
And the district court judge made it clear that the IRS was free to do
this on a voluntary basis, but they could not legally require it, it. If
they did that, that of course would end the legal dispute.”

H&R Block Slams DecisionH&R
Block, which was one of the main proponents of the RTRP tax preparer
regulation regime, reacted with dismay to the Appeals Court decision.

Block
said that in a country where all 50 states regulate hair dressers, the
tax prep chain found it “stunning” that tax preparers, with extensive
access to the personal financial history and identities of their
clients, are not required to meet minimum competency standards.

“It
is outrageous that all consumers don’t enjoy basic protections with
such a significant financial transaction as tax preparation,” said
H&R Block president and CEO Bill Cobb in a statement. “Something is
out of whack when you are better protected when getting your haircut
than when sitting across the desk from a tax preparer. All consumers
should have access to the protection that our clients receive when
working with our highly trained tax professionals.”

H&R Block
noted that it has long supported efforts to better serve and protect
consumers through minimum standards for, and oversight of all tax return
preparers. Block pointed out that it already trains and has continuing
education requirements for all of its tax preparers and added that it
looks forward to working with Congress and the Treasury Department on
“any legislation that may be necessary to implement minimum tax preparer
standards as a formidable tool in the fight against fraud.”

One
tax attorney pointed out that the IRS will still be able to check up on
errant tax preparers, even after the latest ruling. “The IRS’s ability
to require previously unregistered tax preparers to meet certain
education and testing requirements, while perhaps now temporarily set
back a step, will inevitably come to pass because of the important role
preparers play in tax system administration,” said G. Michelle Ferreira,
tax attorney and managing shareholder of the San Francisco office of
international law firm Greenberg Traurig. “I believe law makers will
recognize the need to make explicit that the IRS should be able to set
basic standards for individuals who prepare tax returns so that we can
be sure such returns are correct and in compliance.”

Because the Loving decision does not disturb the rules
requiring all paid preparers to obtain a PTIN, those individuals must
still register with the IRS, Ferreira said, “which still gives the IRS
the ability to check up on preparers where evidence points to problems.”

CPA ReactionsWhile
attorneys and CPAs would have been exempt from the proposed rules,
several CPAs from the New York State Society of CPAs reacted strongly to
the news of the court’s decision Tuesday.

“The potential impact
is that the storefront tax preparer will thrive on the ignorant and the
fraud will continue,” said Vincent Cosenza, CPA and tax manager at
Shanolt, Glassman, Klein and Kramer PC in New York City.

“Much of what the IRS was looking for is already being done by most
CPA firms,” said David Young, CPA, owner of Young & Company CPAs LLC
in Rochester, N.Y. “Having a strong system of quality control for tax
return preparation and continuing professional education is in part what
differentiates a CPA firm from H&R Block and other non-CPA firms.
The taxpayer is ultimately responsible for what is on his or her income
tax return.

“When choosing a tax preparer, the taxpayer should
consider the possible negative ramifications of choosing an unregulated
and unlicensed tax return preparer,” Young advised. “It would be wise
for the taxpayer to ask about the tax preparer’s qualifications,
continuing professional education, and the firm’s quality control as it
relates to tax returns.”

“I am a little upset that unlicensed tax preparers don’t have
to deal with taking CPE and keeping themselves up to date with new
legislation, as CPA are required to do annually,” said Johnpaul
Crocenzi, CPA, a tax manager at Raich Ende Malter & Co. LLP in New
York. “Having the IRS regulate tax preparers will actually protect the
consumer from having a tax return done by someone that doesn’t know or
understand the Tax Code.”

Although the IRS proposed regulation of
tax return preparers did not directly affect CPAs, there is always a
concern about regulations that can creep into other areas, according to
Kevin McCoy, CPA, director of Marvin and Company near Albany, N.Y. But
“until the IRS is granted the authority by Congress, it appears the
unlicensed tax return preparers are free to continue to operate as
before,” he said.

Tuesday, February 11, 2014

This tax more than any other tax can sneak up on you. And once the tax is applied it's difficult if not impossible to lower it or get rid of it. The best way to handle the AMT tax is to do tax planning. At least that way, you can prepare for the tax or avoid it all together.

What You Should Know about AMT

Have you ever wondered if the Alternative Minimum Tax applies to you?
You may have to pay this tax if your income is above a certain amount.
The AMT attempts to ensure that some individuals who claim certain tax
benefits pay a minimum amount of tax.

Here are some things from the IRS that you should know about AMT:

1. You may have to pay the tax if your
taxable income, plus certain adjustments, is more than the AMT exemption
amount for your filing status. If your income is below this amount, you
usually will not owe AMT.

2. The 2013 AMT exemption amounts for each filing status are:

• Single and Head of Household = $51,900

• Married Filing Joint and Qualifying Widow(er) = $80,800

• Married Filing Separate = $40,400

3. The rules for AMT are more complex than the rules for regular income tax. The best way to make it easy on yourself is to use IRS e-file to prepare and file your tax return. E-file tax software will figure AMT for you if you owe it.

4. If you file a paper return, use the AMT Assistant tool on IRS.gov to find out if you may need to pay the tax.

5. If you owe AMT, you usually must file Form 6251, Alternative Minimum Tax – Individuals. Some taxpayers who owe AMT can file Form 1040A and use the AMT Worksheet in the instructions.

About Me

Cassandra A. Ingraham
is a tax instructor and a published author on Amazon.After graduating from DeVry, Chicago, she
lived in Europe, traveled to Canada, Caribbean and Africa and is now living in
Mexico.Before departing the United
States she completed the necessary requirements for the Department of Treasury’s
controversy RTRP (Registered Tax Return Preparer) program.

Cassandra
started Taxes Will Travel in 1999 while living in the San Francisco Bay
Area.It wasn’t long after that that the
small company began to provide online tax services.

Her passion
is writing and SEO.She received her
first SEO certification in June of 2005.Since then she has watched the SEO path change many times due to changes
in the search engine’s policies.You can
check out her free SEO web tools on her site at http://seoworkinprogress.comIf its tax loopholes you’re looking for, Cassandra
is the author of several tax loophole books in the Kindle store, with the most
recent book being:Tax Loopholes,
Tax-Free Living & Retirement, which you can find under C. Ingraham